Oracle and Ellison Eat Crow in Deal With Salesforce ‘Roach Motel’

Despite the bitter rivalry between Salesforce.com CEO Marc Benioff and Oracle CEO Larry Ellison, Salesforce has always been an Oracle customer. Yet Benioff has frequently referred to Oracle’s offerings as a “false cloud” and has downplayed the role of Oracle technology in Salesforce’s stack.

For example, he boasted that Salesforce relies mostly on cheap commodity servers, not Oracle’s expensive Exadata servers, during an ad hoc speech at a restaurant following Oracle’s last minute cancellation of his keynote at the Oracle OpenWorld conference.

You might think then that Benioff would be dying to get away from Oracle. But thanks to a partnership announced this week, Salesforce will be stuck with Oracle for at least another nine years — and start using Oracle’s Exadata servers.

But that’s OK, because it seems the Stockholm syndrome is kicking in. “The best decision we’ve ever made was going with Oracle,” Benioff said during a press and analyst call with Ellison on Thursday. Benioff carefully reconciled his previous criticism with his new found love of all things Oracle. “Since Oracle decided to commit to the cloud, they’ve made a number of improvements,” he said.

Under the new partnership, Salesforce will standardize on the forthcoming Oracle Database 12c, Oracle Linux, Java Middleware Platform, and Oracle Exadata servers. The companies will also create two-way integrations between Salesforce.com’s customer relationship management, or CRM, software and Oracle’s cloud hosted human resources and financial applications.

Oracle is also becoming a customer of Salesforce, which must be hard for Ellison, who called a “roach motel” in 2011, despite being an early investor in the company. “Almost every time we buy a company they’re running Salesforce CRM,” Ellison said during the call. Previously, Oracle would migrate these companies to Oracle CRM. “Now we’re going to leave those implementations in place and wire them up to our financials,” he says.

The announcement follows a disappointing quarter for Oracle, but the company has been on a roll, mending fences and signing partnerships with former rivals. Earlier this week the company announced an agreement to bring Oracle technology to Microsoft’s Azure cloud service, and earlier this month Dell and Oracle announced an alliance.

Now Ellison also gets to boast that Salesforce — which he now calls “the world’s biggest cloud computing company” — runs on Oracle. And integration between the two company’s products could also be key for getting more customers for Fusion, Oracle’s cloud hosted applications. Ellison confirmed that there is a big overlap between users of Salesforce CRM and Fusion.

So is this the end of this epic clash of egos? “Hopefully it will be the end of us getting a little too worked up at times,” Benioff said. He points out that he and Ellison and have been working together for 27 years, reminding us, without actually saying it, that the bad blood between the two men is rather new.

But Ellison promises that he and Benioff will continue to try to be entertaining.